A sports star can sign a 6-year contract that startsat

Chapter , Problem 4-73

(choose chapter or problem)

A sports star can sign a 6-year contract that startsat $1.2M with increases of $0.3M each year for hisexpected playing career of 6 years. It is also possibleto sign a contract that starts at $0.8M for the first yearand then increases at $0.2M each year for 10 years(note some income is deferred until after he retires).If his interest rate for the time value of money is 8%,what is the value of each choice?

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